Today: Twitter reports sales of more than $300 million in the second quarter, blowing away expectations and sending its previously beleaguered stock rocketing higher.

Twitter beats earnings expectations, stock shoots higher

The World Cup helped Twitter score its goal of increased user growth, sending the company's previously beleaguered stock surging more than 35 percent higher Tuesday and seemingly verifying CEO Dick Costolo's raft of changes at the social network.

"We had a strong quarter and made progress on multiple fronts," Costolo said Tuesday. "Our financial performance was truly exceptional."

A sign is posted on the exterior of the Twitter headquarters on February 5, 2014 in San Francisco, California. (Justin Sullivan/Getty Images)

User growth has been the biggest drag on Twitter's stock price, as the San Francisco company has struggled to maintain growth rates exhibited before its 2013 initial public offering. Twitter added 16 million users in the second quarter for a total of 271 million people accessing the service at least once a month, the strongest sequential gain in more than a year, and shares jumped to more than $50 in late trading.

"During the World Cup, we delivered the kind of events experience I've wanted to see from us for some time. These experiences felt alive, they felt wonderfully complementary to the matches themselves," Costolo said, adding that he wants the effort to be a template for future live events.

With a larger captive audience, Twitter's advertising revenues boomed. The company reported a second-quarter loss of $144.6 million, or 24 cents a share, on sales of $312.2 million; after adjusting for factors such as stock-based compensation for employees, the company said it made a profit of $14.6 million, or 2 cents a share. Analysts had expected Twitter to report a loss of a penny a share after adjustments on revenues of $283.1 million, according to Thomson Reuters research.

Twitter's revenue total was more than double its performance from the same period a year ago, at least the 10th consecutive quarter that it has increased sales by more than 100 percent. Financial forecasts suggested Twiter expects that to continue, with predictions of revenues from $330 million to $340 million in the current quarter and more than $1.3 billion for the year, after Twitter recorded sales of $665 million in 2013.

Costolo attempted to divert attention from the World Cup, crediting product changes meant to ease understanding of the platform for new users to avoid the perception that the growth was temporary and thanks to an event that only occurs every four years.

Adding users is critical for the company, which competes for advertising dollars with the gigantic user bases of social-networking rival Facebook -- which has 1.3 billion monthly active users -- and search leader Google. After Twitter's user base grew 44 percent and 39 percent in the final two quarters before its IPO, growth slowed to 30 percent and 25 percent respectively in Twitter's first two quarters as a public company.

The growth in sales may help push Twitter toward elusive profitability.

"At some point, we expect Twitter to be better valued on its revenue and earnings as investors' expectations are converged to Twitter's realistic user growth capability," Wunderlich Securities analyst Blake Harper wrote in a note earlier this week.

That point seems to be now: After falling 40 percent in 2014 through Monday's trading session, Twitter gained 1.7 percent to $38.59 in Tuesday's session, then exploded in late trading to top $50 a share for the first time since March.